Consumers’ credit scores are falling at their fastest rate since the Great Recession. The high cost of living, the return of student debt payments and the continued strain of high levels of credit card debt are all weighing heavily.

This increase in financial pressures translates into higher rent collection risk for multifamily owner-operators, said Charlie Shelly, vice president of sales at TheGuarantors. They need to find ways to mitigate these risks before they impact bad debt and net operating income. 

“Renter finances are under strain as debt grows faster than income,” Shelly said. “Delinquency rates on credit card, auto and personal loans are at or near the highest levels in more than 15 years. For owners and operators, these are early signals of a broader financial strain that could impact rent collection, even if rent is at the top of most renters’ credit stacks.”

In the second quarter, household debt stood at $18.4T, a 1% rise from Q1 and an increase of more than $4.2T since before the pandemic. Credit card debt of $1.2T is 5.9% higher than the previous year.

While borrowing is high, the delinquency rate for credit card debt was at its highest level since the financial crash in 2008.

“While rent is often the last payment to drop because people need a roof over their heads, they might only be one unexpected expense away from being unable to pay,” Shelly said. “Operators could find themselves with a growing amount of bad debt very quickly.”

On top of high levels of debt, credit card scores for many people are being driven down by the impact of student loan delinquencies. In May, the Department of Education resumed collection of federal student loan payments after having suspended referrals for collection since March 2020. 

As a result, as of April 2025, 10% of the population was 90 days or more overdue on student loan repayments in the previous six months, up from 7.4% in January. The 6.1 million consumers with student loan delinquencies saw their credit scores drop 69 points on average. 

Lower credit scores mean that people are less able to secure an apartment when operators use traditional screening methods. So while multifamily operators face an increasing risk that renters miss payments, they also have a shrinking pool of potential occupants, Shelly said. 

While some operators are tempted to lower their screening standards to increase occupancy, the danger is that they will attract renters who can’t afford the rent. 

The answer is to use risk mitigation tools that can boost the potential pool of quality renters while providing financial security against bad debt, Shelly said.

“At TheGuarantors, we’re looking beyond traditional credit scores at things like cash flow, verified payroll information and micropatterns that are often precursors to delinquency,” he said. “When operators can recognize these signs early, they can take proactive steps, like offering flexible payment options or risk-mitigating lease guarantees, before missed rent becomes bad debt and lost net operating income.”

Operators have been using TheGuarantors’ solutions to maintain economic occupancy, Shelly said. This includes areas that have been hardest hit by falling credit scores and high credit card delinquency rates, such as the Sun Belt.

Compounding the situation is that many Sun Belt areas are facing an oversupply of multifamily units. Cities such as Charlotte, Phoenix and Austin are predicted to grow their apartment stock by 7% to 8% in 2025, a boost that will increase competition for renters. 

The best way to navigate changing market conditions in any location is to work closely with partners such as TheGuarantors to minimize financial risks, Shelly said. In the context of oversupply, such partners allow owners and operators to increase their renter pool and approve more nontraditional renters such as freelancers, foreign citizens and recent graduates without increased financial risk.

“We’re seeing the most successful operators focus on stability and predictability,” he said. “They’re using risk management tools such as our lease guarantee product to build financial resilience into their portfolios, so if and when market conditions deteriorate, their rent roll and net operating income remain steady.”

This article was produced in collaboration between TheGuarantors and Studio B. Bisnow news staff was not involved in the production of this content.

Studio B is Bisnow’s in-house content and design studio. To learn more about how Studio B can help your team, reach out to studio@bisnow.com.

The deluge of new apartments flooding the Metro Atlanta market has turned the tables on landlords, who are granting renters more incentives and lower rents.

But with developers hitting the brakes on new projects as financing grows cold, the upper hand may flip back to landlords by late next year.

Apartment renters are finding sweeter deals in the Metro Atlanta market.

Developers are underway with 18,500 new apartment units in Metro Atlanta, pushing the region to fifth place in the U.S. in terms of construction volume, according to an August Yardi report.

A bulk of the new supply is springing up in the suburbs. The 13,000 new units coming up in those areas are increasing the existing multifamily stock by 5%, according to Yardi Business Intelligence Manager Doug Ressler. Anything over 3.5% is considered robust. 

The rush of supply has forced developers to offer more perks to prospective renters, typically in the form of free rent that can span months, and in some areas of the metro area has forced rates downward. The dynamic is allowing renters to lease higher-quality apartments for the same rent.

“It may be a good time for renters to snag an amenity-rich apartment that previously may have been out of reach,” said Crystal Chen, who wrote Zumper’s August report on the multifamily market.

Every major submarket in Metro Atlanta experienced rental rate declines year-over-year in August, with rents dropping anywhere from 4.8% in Forest Park to a whopping 22% in Decatur, according to Zumper. There was an 8.9% drop in Alpharetta, a 6.3% fall in Atlanta, an 11% drop in Roswell and a nearly 10% drop in Sandy Springs, where GID Development Group is building almost 600 new units for its High Street Atlanta Apartments. 

“It’s Economics 101. It’s decelerating rents and concessions are increasing,” Ressler said. “That’s going to make it a very renter-friendly market.”

The share of landlords offering concessions has ballooned nationally from a low of 19.4% in July 2022 to 33.6% in April of this year, according to Zillow.

More than half the rental listings in Atlanta, Raleigh, Charlotte, Salt Lake City, Nashville and Austin include some form of renter incentive, Zillow reported. The Atlanta metro area saw a 14.5% spike in incentives on listings year-over-year in August. 

“Builders have stepped up and built an incredible number of homes in response to soaring rents during the pandemic, and renters are now seeing the benefits,” Zillow Chief Economist Skylar Olsen said in the report. “Now is a great time for renters to find a deal, with more new apartments hitting the market than at any time in the past several decades.”

Independence Realty Trust Inc. is offering incentives ranging from three weeks to two months of free rent in Atlanta, Raleigh, Nashville and Huntsville, Alabama, Senior Vice President Janice Richards said on an Aug. 1 earnings call.

And Mid-America Apartment Communities Inc. Executive Vice President Tim Argo said during an Aug. 1 earnings call that “Midtown Atlanta probably [is] our worst concessionary environment right now, sometimes pushing three months where there are lease-ups.” Mid-America reported rents falling between 8% and 9% for new leases in the region.

But Ressler said the fair weather for apartment renters likely won’t last. New apartment starts are quickly falling across the U.S.: By 2026, developers will be underway with 350,000 versus more than 500,000 today.

With the dropoff in new development, Ressler said Yardi is predicting rents will rise and concessions will fall off by as early as late 2025.

The ingredients for increasing housing demand are not abating, Ressler said. During the pandemic, non-native population growth in the U.S. drove people in spades to rental homes and apartments, especially since many don’t have the ability or credit record to buy homes. That trend is still in place, Ressler said, and is co-mingling with the Gen Z population — many of whom are now in their early and mid 20’s — who are moving out of their childhood homes and searching for places to live.

“So what you have is a double whammy. The demand for multifamily and rentals in general is increasing exponentially. Supply is not able to keep up with it,” he said. “Atlanta is a dynamic city. It’s a gateway city. Because of that, you’re going to see population growth and no real new supply to support it. What that means is prices are going to rise.”